US Dollar Rebounds on Potential Trade Deal
The US dollar index rebounded past the 100 mark on Thursday, extending traction from the previous session as signs of progress in talks between the US and major trading partners signaled that the White House is keen on not going forward with its reciprocal tariff package. The US and the UK are expected to announce a trade deal later today, potentially serving as a template for future deals with other major economic partners ahead of key talks with China this weekend.
In the meantime, the Federal Reserve held interest rates unchanged, but Chair Powell noted heightened risks to both inflation and unemployment. He also rejected the notion of a preemptive rate cut to offset any potential economic fallout from President Trump’s proposed tariffs. Among major currencies in the basket, the dollar underperformed against the SEK after the Riksbank held rates, while the BoE is set to deliver a rate cut.
Source: Trading Economics
